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CIRCULAR No

CIRCULAR No.10/1999/TT-BTC OF JANUARY 29, 1999 PROVISIONALLY GUIDING THE REGIME OF FINANCIAL MANAGEMENT OVER THE SECURITIES TRADING CENTERS

Pursuant to Decree No.178/CP of October 28, 1994 of the Government defining the tasks, powers and organizational structure of the Ministry of Finance;

Pursuant to Decree No.48/1998/ND-CP of July 11, 1998 of the Government on securities and securities market;

Pursuant to Decision No.127/1998/QD-TTg of July 11, 1998 of the Prime Minister on the establishment of the securities trading centers;

The Ministry of Finance hereby guides the financial management regime applicable to the securities trading centers as follows:

I. GENERAL PROVISIONS

1. The Securities Trading Center is a non-business unit with revenues, attached to the State Securities Commission, and has the legal person status, its own head-office, seal and account(s).

2. The Securities Trading Center is provided with State Budget fund for its permanent operation. The deduction for setting up its funds shall be made on the basis of revenues from its operation.

3. The Securities Trading Center shall collect assorted charges and fees under the regulations of the competent level.

4. All revenues and expenditures arising at the Securities Trading Center shall be reflected in Vietnam Dong; if they arise in foreign currency(ies), such foreign currency(ies) must be converted into Vietnam Dong at the inter-bank market exchange rate announced at the time the operation arises.

5. The Securities Trading Center shall draw up quarterly and annual plans on financial revenues and expenditures according to the financial regime prescribed by the State, and effect the book-keeping, settlement of financial revenues and expenditures as prescribed by the Ordinance on Accountancy and Statistics as well as the current regulations of the State.

II. SPECIFIC PROVISIONS

1. The sources of fund for operation of the Securities Trading Center:

a/ The operation fund sources originating from the State Budget:

- The operation fund allocated to the Securities Trading Centers by the State Budget under the annual plans shall comply with the current regulations on drafting, implementing and settling the State budget and with detailed guidance in this Circular.

- Financial assistance and aid from domestic and foreign organizations and individuals to the Centers shall be managed as a State Budget allocation.

b/ Collection of charges and fees at the Centers:

- The Securities Trading Center membership fees paid by member securities firms.

- Securities listing fees paid by the Securities Distribution Companies listed at the Centers.

- Securities trading fees paid by participants in the securities trading activities at the Centers.

- Fees paid for the registration and preservation of securities at the Centers by the securities owners.

- Clearing payment fees for securities trading effected at the Centers.

- Charges paid for the provision of information services by the users of the Centers� services and other charges stipulated by the competent levels.

c/ Revenues arising in the course of operation other than the revenues mentioned above: the interests on revenues mentioned in Item b; and other revenues (if any).

2. Expenditures of the Securities Trading Centers: The expenditures of the Security Trading Centers shall include:

- Expenditures on wages and wage allowances;

- Deductions for social insurance, health insurance and other wage-related payment according to the State regulations;

- Expenditures on travel allowances;

- Expenditures on information, propaganda and advertisement;

- Expenses for stationary, printings (including expenses for printing of forms, dossiers, books in service of the Centers� operation);

- Expenses for preservation and keeping of securities at the Centers: the expenses for counting, transporting and preserving securities, for securities listings, for clearing payment, for securities custody...;

- Expenses for maintenance of equipment that ensure the operation of the trading systems of the Centers;

- Expenses for hooking up information networks in direct service of the Centers� operations.

- Expenses for the procurement of working tools and facilities;

- Expenses for repair and maintenance of property;

- Expenses for training and skill refreshment;

- Expenses for labor safety wears and means;

- Expenses for hiring domestic and foreign experts (if any);

- Expenses for renting working offices and other fixed assets (if any);

- Other necessary and reasonable expenses such as for electricity and water supply, sanitation, guest reception, conferences, transactions...;

- Other expenses.

3. Financial revenue and expenditure management:

a/ General principles in the management of the Center�s financial revenues and expenditures:

- All revenues and expenditures arising in the course of the Center�s operation shall be fully, accurately and promptly accounted into the books of accounts according to the accountancy regime prescribed by the State for the Securities Trading Center. The Securities Trading Center must not keep revenues outside the books or fail to account them in the revenue sources.

- The designated or undesignated aids given by domestic and foreign organizations and individuals to the Center must be accounted like funds allocated by the State budget.

- Other expenditures: on sanitation, public missions, electricity and water supply, protocol, guest reception, conferences... shall comply with the regime prescribed by the State and within the scope of approved plans and quotas.

- Funds established in the year and not used up shall be transfer to the following year for use. Particularly funds allocated by the State Budget in the year and not used up shall be return to the fund-allocating units (except for specifically prescribed cases).

b/ Funds allocated annually by the State Budget and foreign aid shall be considered the State Budget allocations:

The elaboration, implementation and settlement of the annual operation fund plans of the Securities Trading Centers shall comply with the current State Budget management regulations.

c/ For fee and charge collections and other revenues:

All fee and charge collections and other revenues (prescribed in Items b and c, Point 1), called for short as revenues from the Center�s activities shall be used as follows:

1. Fulfilling obligations to the State Budget: The Center shall register to remit 10% of the total charges and fees collected in the year with the tax authority and fill procedures for the fulfillment of obligations towards the State Budget according to the tax authority�s guidance.

2. Subtraction of fines for violations of discipline on budget collection and remittance, fines for administrative violations and fines for breaches of contracts with customers.

3. The remainder shall be deducted by the Center for the establishment of the following funds:

- The welfare and reward funds: the maximum deduction level for each fund shall strictly comply with the prescribed regime applicable to officials and employees of the State Securities Commission.

- The amount left after the deduction for the establishment of the two above-mentioned funds shall be deducted for the establishment of the professional operation promotion fund.

d/ The management and use of professional operation promotion fund:

- The Center�s professional operation promotion fund is formulated as a source of State Budget support to be used for the following purposes:

+ Expenses in support of the procurement of equipment for operation.

+ Renewal of technical and information equipment and facilities and the working conditions of the Center.

+ Covering the costs of maintenance and repair of equipment and machinery for keeping up the trading activities of the Center.

+ Expenses in support of research as well as the professional training of the Securities Trading Center�s personnel.

+ Expenses for ensuring the safety of the securities warehouses.

+ Other expenses in support of particular operation of the Center.

- The use of the professional operation promotion fund must comply with the plan already approved by the competent level. It is strictly forbidden to use this fund for purposes contrary to the prescribed contents.

e/ The management and use of the property of the Securities Trading Center:

- The procurement of property must be made according to plans and approved by the superior managing body. The source of fund used for property procurement is formulated from:

+ The source of State Budget allocated according to plan.

+ The source of supplement from the professional operation promotion fund.

- The spending on capital construction must strictly comply with the State�s relevant regulations on capital construction investment (with plans, with approved estimates, allocation according to tempo, test for acceptance and settlement upon completion).

- The Center�s property must be recorded and monitored in books, conducting periodical inventory and making fixed asset depreciation according to regulations applicable to non-business administrative units.

f/ The Securities Trading Center must not account into its expenditure the following :

- Expenses for overseas trips which exceed the limits prescribed by the State;

- Expenses from such established funds as reward and welfare funds (spending on rewards, difficulty allowance, support for social or mass organizations, other agencies and localities); the professional operation promotion fund (spending on support for procurement of equipment for operation, for training of the Center�s personnel, other expenses).

- Expenses for capital construction and/or the procurement of fixed asset of the Center, belonging to the source of capital for capital construction;

- Other expenses not in accordance with the stipulations in Item 2 above.

g/ Payment support fund managed by the Securities Trading Center:

The Securities Trading Center is authorized to set up and manage the payment support fund from the source of contributions by the member securities companies to be used for the purpose of ensuring the payment timetable when a member securities company is temporarily deficient in payment capability. The management of the payment support fund shall comply with separate provisions independent from the internal finance system of the Center, without accounting it together with the property of the Center.

4. The accountancy, drawing of the balance-sheets and auditing of the Securities Trading Center:

1. The Securities Trading Center shall have to effect the accountancy and statistics according to the Ordinance on Accountancy and Statistics and the accountancy regime promulgated by the Ministry of Finance.

2. The Securities Trading Center shall have to observe the regime of quarterly and annual financial settlement according to the current regulations.

3. The annual financial reports of the Securities Trading Center must be inspected by the State audit.

4. The financial report and the auditing report of the Securities Trading Center shall be submitted to the Prime Minister, the State Securities Commission and the Finance Ministry.

5. Elaboration of financial plans

- By the time of drawing up the annual budget plans, the Securities Trading Center shall have to draw up and report to the State Securities Commission, the Finance Ministry and the Ministry of Planning and Investment the operation fund plan and the financial revenue and expenditure plan of the Center, including:

+ The plan on operation fund to be allocated by the State Budget.

+ The revenue-expenditure plan of the Center.

+ The plan on the use of the professional development promotion fund.

- The Center�s annual estimate, after being approved by the Finance Ministry, shall serve as basis for the unit�s implementation in the year. The State Securities Commission shall have to approve and inspect the implementation of the quarterly revenue-expenditure estimates by the Center within the approved annual estimates. The quarterly estimates already approved by the State Securities Commission shall serve as basis for the Center to implement it.

III. ORGANIZATION OF IMPLEMENTATION

1. The Center shall take responsibility before law for the use of the State budget-allocated funds, strictly complying with the State�s current financial management regulations applicable to administrative and non-business units as well as the regulations in this circular.

2. This circular takes effect 15 days after its signing. Any problems arise in the course of implementation shall be reported to the Finance Ministry for timely supplements and amendments.

For Finance Minister

Vice Minister

TRAN VAN TA